By KT Reporter
Since Donald Trump took top leadership of the USA for the second time in January, his government has made several changes regarding the country’s foreign policies, particularly on aid and trade.
Multinational organisations at the UN, NGOs and governments like Uganda have already lost some of the funding that the American government was providing under previous regimes.
To discuss the impact and find possible solutions, the 5th edition of the Stanbic Uganda Economic Insights Symposium slated for Tuesday next week will feature high-level speakers from the Bank of Uganda, the Ministry of Finance and Economic Planning, Academia, International Development, and the private sector.
Under the theme: Globalization reshaped— Riding the waves of Economic shifts, the symposium will discuss global trends and their potential impact on the local economy.
The return of Donald Trump to the White House has triggered anxiety about the future of globalization as the world’s largest economy—the United States- adopts protectionist policies based on the reciprocal deployment of tariffs.
According to the International Monetary Fund (IMF), increasing trade restrictions could reduce annual global economic output by $7.4 trillion.
“These global trends ultimately have local impact and we have assembled a rich mix of speakers to help participants to have a better understanding to enable informed investment decision making,” said Phillip Ssali, a Global Markets executive at Stanbic Bank Uganda.
In 2025, Uganda will be one of the few African countries that will see a GDP growth rate above six percent—almost double the estimated average rate for the whole continent, with the African Development Bank noting that the primary driver of this growth is investment in the oil sector.
Coupled with a surge in exports of refined gold and higher earnings from coffee, Uganda’s economy has appeared to have largely recovered from the negative impact of the Covid-19 pandemic.
But there are dark clouds on the horizon. Since the outbreak of war between Russia and Ukraine, as well as the eruptions of other armed conflicts, the global economy has been undergoing an extended period of uncertainty.
Rising geopolitical tensions between the leading trading nations also threaten to change the way business and trade are done.
For instance, the IMF suggests that sub-Saharan Africa could stand to lose the most if the world were split into two isolated trading blocs centered around China or the United States and the European Union.
In this severe scenario, after 10 years, African economies could experience a permanent decline of up to four percent of real GDP, losses larger than what many countries experienced during the 2008 Global Financial Crisis.
Uganda would not be spared by this projected global uncertainty as it would slow down the hitherto accelerated programme for value-addition and increased exports.
“Sudden fluctuations in international markets, resulting in more frequent commodity price volatility tends to trigger inflationary pressures. Rising interest rates constrain investment flows, and currency fluctuations can increase the burden of servicing foreign debt, which leads to economic instability,” said Ssali.
National economy architects such as Ramathan Ggoobi, the Permanent Secretary of the Ministry of Finance, continue to express confidence in Uganda’s ability to remain resilient despite facing global challenges such as tighter financial conditions and supply chain disruptions.
This confidence will come under sharp scrutiny during the symposium as discussants such as vocal economist and researcher Dr. Fred Muhumuza analyze whether this resilience can hold and for how long-URN. Give us feedback on this story through our email: kamwokyatimes@gmail.com
